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Wood Products Prices in Europe

16 – 30th November 2019


Report from Europe  

  STTC Conference considers links between FLEGT
licenses and forest certification

To rebuild share in the European market, the tropical
wood sector must exploit emerging opportunities from the
synergies between the FLEGT VPA process and private
sector forest certification initiatives, and to focus
relentlessly on communicating simple messages to target
audiences of architects, designers and civil engineers on
the carbon mitigation and forest conservation benefits of
using sustainable tropical timber.

These were key messages of the 2019 European
Sustainable Tropical Timber Coalition (STTC)
Conference, held in Berlin, Germany, on 20th November.
The Conference was convened to consider the related
themes of tropical timber promotion and the relationship
between certified tropical forest management and regional
and national initiatives in the tropics, including the EU
FLEGT VPA programme and Verified Sourcing Areas.

The event was well attended, with over 100 participants
including tropical hardwood traders, timber trade
association representatives, NGOs, procurement officials,
and technical service providers to the European tropical
wood industry. It followed the successful format of
previous years mixing short presentations with
participatory group discussions led by Peter Woodward,
an enthusiastic and articulate facilitator, to encourage
input from all parties and generate new ideas.

Nienke Sleurink of Netherlands-based IDH, the
Sustainable Trade Initiative, the STTC founder and main
donor, introduced the event, noting that IDH has just
published a new report ¡°Unlocking sustainable tropical
timber market growth through data¡± with the conclusions
of a study to assess the share of FSC and PEFC certified
tropical timber in EU supply chains.

The report concludes that between 25% and 32% of the
total tonnage of tropical primary wood imports (logs,
sawnwood, veneer and plywood) into the 7 main EU
importing countries, which together account for over 90%
of all EU tropical imports, was either FSC or PEFC
certified in 2018.

The proportion varied widely between countries, being
highest in the Netherlands (65% to 70%), followed by the
UK (40% to 45%), Germany (30% to 35%), Belgium
(25% to 30%), France (10% to 15%), Italy (5% to 10%)
and Spain (2.5% to 7.5%).

Ms. Sleurink explained that this assessment of certified
timber share of tropical timber imports will be an annual
exercise, the aim to build on and improve the
methodology, and a ToR is being prepared for the next
report in 2020. She emphasised that this data-based
analysis helps IDH to identify gaps in supply sources and
to better target market access initiatives.

The methodology for the IDH assessment of certified
timber share was explained to the Conference by Mark van
Benthem of Dutch foundation Probos. In the absence of
direct data on certified trade flows from FSC or PEFC, the
analysis uses the ¡°exposure to certification¡± proxy
measure pioneered by the ITTO FLEGT IMM project. The
basic methodology assumes that if, say, 40% of forest area
in a country is certified, then the ¡°exposure to
certification¡± of all wood exports from that country is also

For the IDH assessment, Probos refined the methodology
by replacing total forest area with best available data on
production forest, and through surveys of large certified
producers in the tropics and traders in the EU. This helped
to estimate, for example, the likely proportion of certified
timber produced in the tropics destined for the EU
compared to other markets (ranging between 50% to

A conclusion of the IDH assessment is that ¡°between 2.7
and 4.4 million hectares of forest are maintained with
SFM practices under current levels of EU28 certified
natural and semi-natural forest tropical timber demand.
For perspective, a total of 14.8 million hectares (excluding
plantations) is certified in the tropical regions,
representing 6.2% of production forest in the tropics¡±.

Drawing on this data, IDH estimates that ¡°the EU28
currently impacts 18%-30% of all certified semi and
natural tropical forests with its current demand for
certified primary tropical timber products. Projecting these
figures onto a world in which EU sourced 100% certified
tropical timber, we see the impact multiplied, protecting
an additional 11.7-13.4 million hectares of tropical forest¡±.

Achieving mutual benefits from certification and

In her introductory remarks to the STTC Conference, Ms.
Sleurink observed that a key issue for both IDH and STTC
is to explore the links between forest certification and the
FLEGT VPA process. A draft IDH paper on this issue, for
which comments were invited, was distributed at the
Conference, setting out the similarities and differences
between the processes, emphasising their complementarity
and suggesting that ¡°both [are] crucial to ensure
sustainability in the tropical timber trade¡±.

As background, two speakers with contrasting views, one
an advocate for FLEGT, the other for FSC certification,
were given the floor.

In support of FLEGT, the UK TTF Director Dave Hopkins
opened with the observation that, in a world where the
EU¡¯s direct influence as a buyer of tropical timber is
waning and progress to implement third party certification
in the tropics has been slow, ¡°EU policy makers need to
try every trick in the book to extend land under

According to Mr. Hopkins, ¡°If we¡¯re to have any
influence, with only low uptake of certification to date, we
have to encourage development of [verification] systems
that reflect what producers can do in reality¡±.

Mr. Hopkins suggested that the essential difference
between the two policy measures is that ¡°certification is a
company approach while FLEGT is a national approach.
FLEGT aims to promote sustainable forest policy and
strengthen forest governance at national level to raise the
baseline for all¡±. He also observed that ¡°There¡¯s nothing to
prevent a forest management unit being certified on top
and FLEGT can make certification easier to achieve¡±.

Mr. Hopkins characterised certification as ¡°islands of
utopia, the pinnacles of sustainability¡± and suggested that,
in the absence of effective national forest policy
framework, certified areas ¡°suffer in much bigger
landscapes where the [uncertified] forest lands become

He suggested that a key issue for certification, which
FLEGT is better able to address, is to do with permanence.
¡°Because certification is linked to an individual company,
if that company goes bankrupt, or sells up, what happens
to that concession? The certificate may well be allowed to
lapse. There needs to be a permanent baseline which can
only be established through regulation, which can be
delivered through FLEGT¡±.

Mr. Hopkins identified ¡°scale¡± as a second benefit of
FLEGT. While certification delivers sustainable practices
for scattered forest management units, FLEGT operates
nationally across all forest types and ownerships. ¡°I
suspect the forest land area that Indonesia has under
management recognised through FLEGT exceeds the
entire area of certified forest in the tropics¡±, he said.

Other benefits of FLEGT identified by Mr. Hopkins
include the VPA annexes setting out detailed requirements
for transparency and national level oversight, which
benefits both consumers and producers, and the
requirement for stakeholder participation in forest law
reform, so that the FLEGT process becomes ¡°something
that producers own, something they themselves have a
connection to¡±.

Mr. Hopkins referred to independent studies which
indicate that forests regulated through FLEGT legality
assurance mechanisms in Indonesia and Ghana already
meet many of the requirements of FSC or PEFC.
However, some buyers and specifiers still refuse to
recognise FLEGT because it is perceived as ¡°just legality¡±.

According to Mr. Hopkins, ¡°when speaking to companies
in Indonesia, they say there is little awareness, even in the
EU, of the considerable advances towards sustainable
forest management made through the FLEGT VPA
process. This means they are having to pay twice, once for
SVLK (the national system on which FLEGT licenses are
based) and separately for FSC or PEFC. This makes no

Mr. Hopkins went on to suggest ¡°we should be trying to
lower the unit costs to producers to get more area under
management. Once producers are engaged in the process,
there¡¯s leverage to move them up the curve. If they are not
in the process, we have no influence¡±.

He concluded, ¡°FLEGT is bringing companies to the door
of certification. There are strong complementary benefits
and we importers must get over our hang ups, recognise
that Europe is a less significant market for tropical wood
products, but also that there are mechanisms other than
certification that we can use to influence practice and
shorten the gap between legal and sustainable¡±.

Making the case for an exclusive focus on FSC
Jesse Kuijper of the Borneo Initiative which is working to
expand FSC certification in Indonesia, presented an
opposing view. Mr. Kuijper was a cofounder of the FSC
and the focus of his earlier work was to raise FSC market
share in the Netherlands.

His work began in Borneo a decade ago at a time when
environmental groups had characterised the forest
conservation situation there as ¡°hopeless¡±, according to
Mr. Kuijper, with on-going large-scale conversion to palm

The Borneo initiative was founded in 2008 to demonstrate
an alternative development model built around FSC
certification of sustainably managed natural tropical forest.
Mr. Kuijper said that there were many real barriers to this
vision, including lack of funding, initial lack of trust in
NGOs, and lack of local management and technical
capacity for forest certification.

However, Mr. Kuijper explained that working with
partners TFF, WWF, TNC and Wana Aksara Institute, and
with financial support from these agencies and a range of
corporate sponsors, the Initiative has progressively
overcome the barriers and created a successful working

The Borneo Initiative has focused heavily on training and
capacity building in Indonesia, and on group and other
arrangements to make certification more affordable, linked
to continuing work on the market side to communicate the
benefits of FSC certification in tropical forests.

Mr. Kuijper noted that in 2009, at the start of The Borneo
Initiative, there was a baseline area of 0.9 million hectares
of FSC certified forest in Indonesia, plus 0.3 million
hectares of FSC Controlled Wood.

By 2018, the Initiative had facilitated an additional 26
FSC certificates covering 2.4 million hectares. Overall,
there are now 40 forest companies with FSC certification
in Indonesia, covering 3.1 million hectares in total.
Additionally, there are 10 forest plantations with FSC
certification (416,157 ha) and 11 community groups
(22,570 ha).

Mr. Kuijper mentioned that there is an additional 1 million
hectares certified against the FSC Controlled Wood
standard and two million hectares on the waiting list for
FSC in Indonesia. The Borneo Initiative target is to
achieve 8 million hectares of FSC certified forest, an
additional 8 million hectares recognised under the
Controlled Wood standard, including 3 million hectares of
reforested degraded lands.

As a counterpoint to Mr. Hopkins earlier comments, Mr.
Kuijper was dismissive of initiatives other than FSC. He
said that, ¡°having seen the operation of all schemes [in
Indonesia] over a period of 12 years, it is untrue that these
other initiatives are helping to raise standards on the
ground. The only system doing that is FSC. The
companies in the mandatory scheme have higher costs and
are in worse shape than they were. They are the one¡¯s
going bust¡±.

He also said that ¡°the lives of people in the FSC
concession, which create thousands and thousands of jobs,
are much better than those in the mandatory certified

Mr. Kuijper went on to say that the business model for
FSC certification in tropical countries needs to be
developed and highlighted the potential role of plantations
established on already degraded lands to support the costs
of natural forest offsets. He suggested there is a need to
diversify into markets other than timber, including carbon
offsets and other environmental services. He concluded by
urging IDH, and the Conference attendees, to focus their
support on FSC certification in the tropics.

¡°Verified Sourcing Areas¡± may offer a way forward
Given these opposing arguments, it was useful that a third
concept, relating to ¡°Verified Sourcing Areas¡±, was
presented at the STTC Conference which may offer some
potential to resolve the tensions between the national
regulatory approach of FLEGT and the individual
operator-based approach promoted by FSC.

Like the FLEGT VPA process, the ¡°Verified Sourcing
Areas¡± concept provides an assurance that an effective
forest and land-use policy framework is operating within a
specific jurisdictional area.

However, unlike the FLEGT VPA process, which is
always national in scope, it operates at smaller regional
scales and allows for, and recognises, that a variety of
policy tools, both regulatory and non-regulatory, including
private sector certification, contribute to sustainable land
use practices within the verified area. It has the added
advantage of seeking to integrate sustainability assurances
for timber with similar assurances for agricultural

The Verified Sourcing Area concept was introduced at the
STTC Conference by Nienke Sleurink of IDH who
referenced the PCI (Estrat¨¦gia: Produzir, Conservar e
Incluir) scheme in Mato Grosso, Brazil, a state with a
strong interest in demonstrating the sustainability of
timber alongside other commodities to the international

Mato Grosso is the largest timber producing state in Brazil
and also one of the largest beef and soy producing states.

Additional details of the PCI were made available at the
Conference during roundtable discussions involving
representatives of the Mato Grosso Environment State
Secretariat and the state Center for Wood Producing and
Exporting Industries (Cipem), together with consultants
engaged to develop the system.

The Conference was informed that Mato Grosso has
introduced a green growth plan, developed by a multistakeholder
group comprising beef, soy and timber
companies alongside civil society. The plan includes
specific targets to counter illegal deforestation and to
increase reafforestation and the area under sustainable
forest management. The PCI is constituted as an agency
independent of government, to insulate it from political
changes, but local government agencies were intimately
involved in setting the targets.

A Monitoring Working Group (WG) comprising
representatives of Brazilian government agencies,
agricultural and forestry associations and NGOs was
formed in early 2017 to evaluate advances towards the PCI
targets. According to information made available at the
Conference, a key part of the PCI mechanism is
transparency, ensuring that data on progress to implement
the targets is readily accessible, making best use of the
latest technology. An online dashboard, together with full
details of the PCI are available at

Another concern of PCI is to ensure recognition for the
system in key export markets, so there is a focus on
providing data that can be used by EU operators importing
from Matto Grosso to assist EUTR compliance. Efforts are
being made to benchmark PCI requirements against FSC
and PEFC certification standards. The dashboard also
provides specific data on issues of deep concern to the
international community such as carbon emissions from
land use change in the state.

A call for targeted tropical timber promotion
Another focus of the STTC Conference was market
development strategy for tropical timber products in
Europe. Mark van Benthem of Probos introduced this
topic noting recent expansion of the STTC website
( into a hub for marketing
of certified tropical timber, providing links to agencies and
resources relevant to this work.

He also referred to ATIBT¡¯s new Fair and Precious
website ( providing
information on certified tropical timber products.

Mr. van Benthem reported preliminary results of a survey
targeting the largest EU importers of tropical timber to
assess their awareness of the marketing tools available
from STTC and ATIBT and asking views on whether they
are fit for purpose.

Drawing on the first 33 responses received (all from
northern Europe with none yet received from Italy and
Spain), he noted that most importers had a clear perception
that Europe¡¯s trade in tropical timber trade is declining,
the only exception being in the Netherlands. Most also
said that trade in certified tropical timber is falling, again
the Netherlands being the only exception.

The level of awareness amongst surveyed companies of
the marketing tools available for promoting tropical timber
was also low. Those that expressed a view also reckoned
that the existing tools have only limited impact and are not
changing attitudes amongst end consumers.

Drawing on the results of the survey, Mr. van Benthem
said that ¡°European importing companies are quite passive
in their marketing of tropical timber, mainly
communicating via websites and through direct
conversations. Very few have dedicated PR staff.
Generally, interviewees look to their trade associations to
lead on marketing and to provide communication tools.
And price is always an issue, consumers always tend to
choose the cheapest option¡±.More positively, however,
Mr. van Benthem said the survey indicated ¡°growing
momentum in support of timber on carbon¡±.

Mr. van Benthem went on to say that successful marketing
of tropical timber required a ¡°tailored approach¡­what
works in the Netherlands won¡¯t necessarily work
elsewhere¡­.there also needs to be more coordination and
less fragmentation, we all need to talk up the benefits of
wood, with less fighting between different wood sectors,
and the wood must be sustainably sourced¡±.

Eric de Munck of Centrum Hout, the wood marketing arm
of the Netherlands Timber Trade Association, provided a
case study of the ¡°tailored approach¡±, also illustrating the
value of companies working together to develop demand
in specific end use applications.

Mr. de Munck explained that twelve members of Centrum
Hout are working together to implement an action plan to
strengthen demand for tropical timber in civil works,
identifying bridges and sheet piling for water protection as
key markets.

Research undertaken to assess market trends had revealed
that the volume of tropical timber used in these
applications had fallen having come under intense pressure
from substitute materials. A Centrum Hout survey
identified civil engineers as the key decision makers in the
material procurement process for the target applications.

The survey revealed that 150 engineering companies in the
Netherlands play a role, of which 10 are dominant. Direct
contact with these companies revealed a serious lack of
existing knowledge on the technical and environmental
properties of wood, and of the life-time costs of utilising
tropical wood compared to other materials.

To fill this knowledge gap, Centrum Hout, supported by
STTC, commissioned life cycle assessment (LCA) and
whole-life cost studies comparing use of tropical timber
with other materials in the targeted applications. The
results demonstrated very significant benefits, both from
an environmental and cost perspective, of using tropical

Consulting with the engineering firms, Centrum Hout
identified lunch time technical meetings as the most
effective way to communicate the results of this research
and other technical data on tropical timbers to the

Other communication channels were developed including
articles in targeted journals and clearly accessible links to
relevant reports, LCA data and project case studies on the
Centrum Hout website. A task force was established to
trouble shoot technical, communication and policy issues
as they arise.

The campaign has led to increased awareness of the
benefits of tropical timber amongst key decision makers.
Rather than always making the first move, buyers and
specifiers now actively invite Centrum Hout to assist with
development of procurement policy and other measures to
promote a circular economy.

Mr. de Munck concluded that to promote tropical timber
¡°it is essential that companies join forces to strengthen the
message, share costs, and increase the impact¡±. He also
emphasised that ¡°demonstrating sustainability in the forest
provides an essential foundation for all environmental
claims relating to timber¡± and that ¡°certification increases
credibility¡±. Finally, Mr. de Munck stressed the
importance of ¡°repeating simple messages over and over
again¡± emphasising that the carbon message has
particularly strong resonance.


LM       Loyale Merchant, a grade of log parcel  Cu.m         Cubic Metre
QS        Qualite Superieure    Koku         0.278 Cu.m or 120BF
CI          Choix Industriel                                                       FFR           French Franc
CE         Choix Economique                                                        SQ              Sawmill Quality
CS         Choix Supplimentaire      SSQ            Select Sawmill Quality
FOB      Free-on-Board     FAS            Sawnwood Grade First and
KD        Kiln Dry                               Second 
AD        Air Dry        WBP           Water and Boil Proof
Boule    A Log Sawn Through and Through MR              Moisture Resistant
              the boards from one log are bundled                      pc         per piece      
              together                      ea                each      
BB/CC  Grade B faced and Grade C backed MBF           1000 Board Feet          
              Plywood   MDF           Medium Density Fibreboard
BF        Board Foot F.CFA         CFA Franc        
Sq.Ft     Square Foot              Price has moved up or down

Source:ITTO'  Tropical Timber Market Report

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